Oil Market Looks Past Hormuz Risks, Prices Remain Rangebound

The oil market is showing resilience in the face of ongoing tensions in the Strait of Hormuz, according to MUFG. Despite heightened geopolitical risks, crude prices have remained relatively stable and rangebound.

This behavior suggests that traders are focusing on supply-demand fundamentals rather than reacting to headlines, which has historically led to sharp price spikes. As of early 2025, Brent crude futures have hovered in a narrow band, indicating that investors perceive the risks as manageable or short-lived.

The market dynamics reflect a tug-of-war between supply concerns and global demand outlook. While geopolitical events in the Middle East often trigger volatility, the current reaction has been muted, suggesting traders prioritize inventory levels and demand projections.